How to enhance your life insurance policy through riders

There are times when you have taken a product of your choice but need to enhance it with a few additions of your choice. In the case of life insurance, you can do the same with riders. Riders are basically add-on or additional benefits that you can opt for along with any existing life insurance policy at a very low cost.

Riders must be opted for at the time of initiating the plan, or depending on the flexibility, can be opted for at a future date too. Riders can be considered as a tool that enhances your life insurance policy by offering several kinds of health and other benefits to a policyholder.

Riders cover critical illness, accidental death and disability and can also waive off future premiums in case of unfortunate death or disability to the policyholder, thereby ensuring continuity of coverage.

Why should I buy a rider?

Riders are a practical solution to enhance your financial protection. Some of the key advantages of riders are as below:

Additional protection: Riders can help you meet specific requirements as well as augment certain benefits on your base life insurance plan. For example, a term rider can give you an additional sum insured but would not be as comprehensive as an individual term plan.

Affordability: A rider comes at a much lower price as compared to if you were to take a separate policy for the same need. Further, there is a variety of riders that one can take. One can opt for multiple riders to cover oneself against various risks at a reasonable cost.

Flexibility: You can customise your life insurance on any platform - term, endowment, money back, whole life or Ulip- by adding a suitable rider.

Tax Advantage: Like your life insurance plan, premium for riders also gives you a tax benefit as per current tax laws.

Which rider should I choose?

Since insurers mostly allow you to opt for a rider only at the inception of the policy, it is important to know the various options of riders available.

Term Rider: The benefit of this rider is that you need not buy a separate cover policy to get term cover and can instead attach it to your savings plan, which will be more economical than a separate policy.

Accidental Death Benefit and Partial/ Total Disability Benefit Rider: This rider provides coverage in the case of accidental death or disability. Since there is usually no separate cover for accidental death or disability under the base policy apart from the life coverage, these riders give the policyholder the advantage of being covered from accidents and is thus recommended at all stages of life.

Waiver of Premium Benefit Rider: This particular rider when taken with an endowment plan ensures your maturity benefit is protected even if the policyholder cannot pay all the premiums. In case of child plans, a waiver of premium rider is beneficial to ensure that the child receives the benefit even in the case of an unfortunate demise or disability of the parent.

Income Benefit Rider: This type of rider provides a regular income to the family in case of the demise or accidental disability to the breadwinner of the family. So, like the Waiver of Premium Benefit Rider, this one too is greatly beneficial when clubbed with a child plan.

Critical Illness Benefit Rider: Since certain illnesses can result in heavy expenses for treatment, Critical Illness Benefit Rider provides a one-time lump sum benefit on the diagnosis of the illnesses.

Hospital Cash Benefit Rider: This particular rider pays a fixed sum of money per day of hospital stay as a result of injury, sickness, or disease. The amount is reimbursed as a lump sum at the end of the stay in hospital. This rider can take care of the expenses to some extent which are not reimbursed under the health insurance plan.

Women Specific Riders: While the aforesaid are some of the most common riders available, there are certain life insurers who provide security for women specific disorders or complications resulting from pregnancy, congenital disabilities etc.